Goldman Sachs Sets $1 Trillion M&A Record

Breaking a six-month record, the investment banking giant capitalizes on a surging wave of global megadeals. Goldman Sachs said it had advised on more than $1 trillion of announced global mergers and acquisitions so far this year, the fastest any investment bank has reached that milestone in a six-month period, citing data from capital markets data provider Dealogic. The bank attributed the milestone to a string of marquee mandates, including serving as co-financial adviser to Dominion Energy on its roughly $67 billion sale to rival utility NextEra Energy, announced last month, along with other major transactions. Rise of the Megadeal Goldman reported that its investment banking fees rose 48%, to $2.8 billion in the first quarter. It’s a reflection of the “K-shaped” M&A market, where megadeals are the dominant force, but deal volumes are declining, and mid-market activity is subdued. Data compiled by PwC revealed that the global M&A market is on track to reach $4 trillion in 2026, a 13% annual increase, with major sales estimated to account for 48% of deal value worldwide, a significant expansion from two years ago. “Goldman has been the global leader in M&A advisory fees for more than 90 consecutive quarters. The fact that it’s reaping benefits from a moment of megadeal activity simply proves the strength of its franchise,” said Mark Narron, senior director at Fitch Ratings. “However, advisory revenues are generally a small share of total revenues. In 2021, which was Goldman’s record year for advisory, advisory revenues contributed only 10% of total revenues.” Fitch says it’s difficult to forecast whether Goldman’s advisory revenues will continue to climb, given the cyclical nature of advisory fees and uneven regional M&A trends — with most deal activity still concentrated in the U.S. Fitch expects M&A activity to be sensitive to market conditions, economic growth, geopolitical events, and interest rates. Global growth is estimated to decelerate to 2.8% this year, according to the latest OECD economic outlook report. Inflationary pressures are rising in advanced and emerging economies due to energy shocks from the Iran conflict. Prices in the G20 economies are expected to climb to 4% in 2026. In a “prolonged disruption” scenario, inflation could rise further, which may prompt hawkish interest rate responses from central banks. Peter Taberner is a contributing writer based in the U.K.